Toll Brothers Sees Revenues, Orders Slide

Horsham, PA, February 6, 2008--Luxury home builder Toll Brothers Inc. said revenues for its first quarter fell 22 percent compared to a year ago.

Preliminary revenues were $842.7 million. Its backlog of approximately $2.40 billion declined 42 percent compared to FY 2007's first-quarter end.

Gross signed contracts for the first quarter were $573.2 million--904 homes--a 46 percent decline in dollar volume and 38 percent decline in the number of homes.

A year ago the totals were of $1.07 billion and 1,463 homes.

In addition, in the first quarter 2008, Toll had 257 cancellations totaling approximately $198.0 million, compared to 436 cancellations totaling $318.9 million last year.

The average price per unit of gross contracts signed in FY 2008's first quarter was $634,000, compared to $730,000 last year. The decline was due to the Toll's product mix, which, in the near term, has a higher percentage of multi-family attached communities that tend to be lower-priced than its single-family detached communities.

Toll has continued to renegotiate and has fewer lots under option, falling to 57,000 in the first quarter from last year's total of 91,200.

"The housing market remains very weak in most areas," said CEO Robert Toll. "Based on current traffic and deposits, we are not yet seeing much light at the end of the tunnel.

"Based on the demographics, improved affordability and interest rates near historic lows, customers should be attracted to the abundance of standing inventory at the aggressively low prices being offered by builders. However, buyers seem to be hiding. We think that the market's problem is a lack of confidence, not just regarding the direction of home prices, but, more broadly, in the direction of the overall economy and the state of the nation."